The deadline for a 10% permanent reduction of capital gains tax owed on original investment expires December 31, 2021.
Opportunity Zones, created under the Tax Cuts and Jobs Act of 2017, are an economic development tool that also provide potential tax benefits to investors.
Investing in Opportunity Zone real estate projects offers two substantial tax advantages, as well as diversification to investors who have short/long term gains from any source, RSU’s, stocks, bonds and property:
- Deferral of capital gain on sales of capital assets used to fund an OZ investment.
- Elimination of the capital gains taxes due on sale of the OZ Investment.
Important dates to be aware of:
- Investments can be made into qualified opportunity zones until December 31, 2026
- December 31, 2021 is the deadline for an investment to be made in order to have held it for five years before the end of 2026
- When held until December 31, 2026, the investment qualifies for a 10% basis step-up and related gain exclusion
Don’t miss out on the potential tax benefits that can result from Opportunity Zone investing.
If you plan to invest in an Opportunity Zone Fund, the best time to do so is before the end of the year.
Pinnacle Partners is an early first-mover in Opportunity Zones and has successfully closed multiple projects and built a strong pipeline of future opportunities.